Nissan full-year results beat estimates, forecast bullish

Nissan full-year results beat estimates, forecast bullish

Nissan's full-year net profit to May 2023 slightly topped its estimate and offered an upbeat forecast for the fiscal year ahead
Nissan's full-year net profit to May 2023 slightly topped its estimate and offered an upbeat forecast for the fiscal year ahead. Photo: Richard A. Brooks / AFP/File
Source: AFP

PAY ATTENTION: Enjoy reading our stories? Join YEN.com.gh's Telegram channel for more!

Nissan said Thursday its full-year net profit slightly topped estimates and offered an upbeat forecast for the current fiscal year, despite warning of "challenging" conditions ahead.

The Japanese automaker said it logged a net profit of 221 billion yen ($1.6 billion) for the year to March 2023, just beating its prediction of 220 billion yen, and projected 315 billion yen ($2.3 billion) for the coming year.

The company said the gains were the result of sales improvements and cost-cutting, as well as favourable foreign exchange rate fluctuations.

These helped offset the effects of an increase in raw material prices and inflation.

"The prolonged shortage of semiconductors and tight supply of parts due to the shutdown in China had a sizeable impact on production plans and vehicle supply," the company said.

But while crises such as the global semiconductor crunch are yet to be fully resolved, there is reason to be cautiously optimistic about Nissan's business in China for the year ahead, said president and CEO Makoto Uchida.

Read also

Toyota full-year net profit beats forecast

PAY ATTENTION: Follow us on Instagram - get the most important news directly in your favourite app!

"China's end to zero-Covid policy resulted in normalising its economic activity," he said, adding that the situation there "is improving".

Nissan is on course to recover from the havoc wrought by pandemic lockdowns, the war in Ukraine and the arrest of former boss Carlos Ghosn, which all helped plunge its full-year results into the red in 2020 and 2021.

The company said last month its global sales for the year to March 2023 stood at 3.16 million units, up 5.4 percent from a year earlier.

But despite the increase, the sales were still lower than its earlier estimate of 3.4 million units, an indication that virus lockdowns in China and semiconductor shortages hit Nissan hard, analysts said.

In March, ratings agency S&P downgraded Nissan's credit rating to junk status on the assumption of another tough year ahead.

Read also

Nintendo annual net profit beats forecast on strong game sales

But the worst of a surge in raw material costs may now have passed, said Satoru Takada, an auto analyst at research and consulting firm TIW.

Nissan signed a landmark deal this year rebalancing its fraught alliance with French partner Renault.

The revamped tie-up ended Renault's decades-long dominance over Nissan that has often been dubbed the "unequal treaty", slashing its share in the Japanese company to 15 percent from 43.4 percent.

The agreement involved Nissan taking a stake of up to 15 percent in Renault's new electric vehicle venture Ampere.

Nissan now plans for hybrids and EVs to make up 55 percent of its global sales by 2030.

Last year, it launched its "Sakura" model -- a fully electric car in the mini-sized "kei" category that is popular in Japan. It accounted for a third of the country's EV sales in 2022.

But Japanese automakers overall have entered the electric vehicle market later than counterparts in some other countries.

Read also

Saudi Aramco banks lower $31.9bn after drop in oil prices

Nissan acknowledged it had arrived late to the party in China, where EVs have skyrocketed in popularity.

Nissan COO Ashwani Gupta said on Thursday the EV market in China in 2022 "rapidly grew, whereas we were short of electrified vehicles".

New feature: Сheck out news that is picked for YOU ➡️ click on “Recommended for you” and enjoy!

Source: AFP

Authors:
AFP avatar

AFP AFP text, photo, graphic, audio or video material shall not be published, broadcast, rewritten for broadcast or publication or redistributed directly or indirectly in any medium. AFP news material may not be stored in whole or in part in a computer or otherwise except for personal and non-commercial use. AFP will not be held liable for any delays, inaccuracies, errors or omissions in any AFP news material or in transmission or delivery of all or any part thereof or for any damages whatsoever. As a newswire service, AFP does not obtain releases from subjects, individuals, groups or entities contained in its photographs, videos, graphics or quoted in its texts. Further, no clearance is obtained from the owners of any trademarks or copyrighted materials whose marks and materials are included in AFP material. Therefore you will be solely responsible for obtaining any and all necessary releases from whatever individuals and/or entities necessary for any uses of AFP material.